UnitedHealth Faces Fraud Inquiry, Stock Slides

Moz Farooque

Thu, May 15, 2025, 9:14 AM 1 min read

UnitedHealth's (NYSE:UNH) stock skid lately with The Justice Department's healthcare-fraud portion softly opening a reappraisal of UnitedHealth's Medicare Advantage arm, according to the Wall Street Journal.

• Warning! GuruFocus has detected 4 Warning Sign with UNH.

Regulators are zeroing successful connected whether the insurer leaned connected kickbacks oregon upcoding diligent information to foodstuff national payments. No surprise, the shares tumbled 15% connected the archetypal quality and slipped different 8% successful after-hours trading, with a further 7% driblet successful the premarket.

This latest probe piles onto a drawstring of headaches. UnitedHealth amazed the marketplace with a abrupt CEO shake-up this week, and backmost successful February the aforesaid DOJ part was reportedly poking astir akin Advantage practices. To apical it off, shareholders are suing, claiming UnitedHealth downplayed fallout from the tragic execution of its erstwhile CEO, Brian Thompson. Through it all, the institution maintains it hasn't received immoderate ceremonial transgression announcement and insists its Medicare Advantage programme is rock-solid.

Why does it matter? A ceremonial DOJ uncovering could bring stiff fines, unit carve-outs of profitable concern lines and formed a agelong shadiness implicit aboriginal net forecasts. With UnitedHealth insisting it's successful afloat compliance, investors volition beryllium watching intimately for immoderate authoritative chargesand for signs that the stock price, which has yet to find its bottom, mightiness yet stabilize.

The banal has dropped sharply implicit the past 3 months, falling astir 49% to $269.16 arsenic of May 15. The steepest diminution happend successful mid-April and the nonaccomplishment of assurance appears sustained, with nary signs of betterment connected the chart.

This nonfiction archetypal appeared connected GuruFocus.